Port Canaveral expansion full steam ahead

The new Norwegian Cruise Lines ship Breakaway, making its first docking at Port Canaveral, Tuesday, October 15, 2013.

The new Norwegian Cruise Lines ship Breakaway, making its first docking at Port Canaveral, Tuesday, October 15, 2013. (Orlando Sentinel)

Sara K. Clarke, Orlando Sentinel

As Port Canaveral heads into the new year, big changes are underway to establish the port as a cargo destination and to draw more cruise ships.

In January, the port will begin work on deepening its channel to make room for cargo vessels and on widening it to accommodate ever-larger cruise ships. In addition, it's building both a new cruise terminal, to open in November, and a new cargo facility, also opening next year. The projects are part of a five-year, $587 million capital campaign.

"We're very confident these are not pie-in-the-sky ideas," said John Walsh, who in March took over as head of Port Canaveral, east of Orlando. "These are executable plans that will be successful business models."

Orlando's theme parks are a key destination for many cruisers making port-of-call visits at Port Canaveral. Starting in January, Disney Cruise Line will have three of its four ships based at the port, and cruisers have the option to pair their trip at sea with a visit to the theme parks.

The projects are a significant economic effort in Brevard County, an area that has suffered from the loss of the space shuttle program and many high-wage jobs that went with it. More cruises mean more tourists who might spend the night in Brevard hotels before their ship departs. And cargo could spawn a distribution network of warehouses and trucking throughout east Central Florida, perhaps reaching into Orange County.

"The tourism industry is crucial to our economy, but as we look to grow and diversify, increasing Port Canaveral's cargo capacity will help create manufacturing opportunities throughout the region," said Orange County Mayor Teresa Jacobs. "A strong partnership with 'our port' creates a gateway to enhanced economic opportunities for Orange County."

Canaveral hasn't been a serious cargo player in the past. It handles the equivalent of "a couple hundred" 20-foot containers a year, Walsh said. The new cargo facility will have ship-to-shore cranes that can move goods in mass and is expected to process 100,000 containers in its first year, with a maximum capacity of 600,000.

"We can save the companies that are bringing in those products and shipping out products a substantial amount of trucking," Walsh said.

In addition to cargo, Port Canaveral is targeting more cruise passengers. The port now serves about 4 million passengers a year, and in 2012 was ranked by the American Association of Port Authorities as the second-busiest cruise port in the U.S., behind PortMiami. Some begin and end their journey at the port, while others disembark from ships docked there for the day and head to attractions such as Walt Disney World and Kennedy Space Center. Officials hopes to attract more than 5 million passengers by 2016 and 6 million by late 2017.

Walsh expects growth in the industry in general, and said South Florida ports are constrained in how much they can expand. He expects the overflow will come to Port Canaveral, which he says is a "logical growth point" for carriers who want to get to the Bahamas and the Caribbean, a major destination for the industry.

Key to that growth is a new 185,000-square-foot cruise terminal, with expanded berth capacity that will accommodate bigger ships. Royal Caribbean's Quantum of the Seas, the largest ship ever to call at Port Canaveral, is scheduled to arrive next fall.

Next year, officials at the port will begin identifying locations for three future terminals, with plans to begin construction on the next one in 2016 or 2017. Also on the drawing board: a shopping, dining and hotel area within walking distance of the cruise terminals, expected to open in summer 2015.

Walsh said the improvements at Port Canaveral are funded through operating profits, government grants and debt. The port generates about $35 million in cash flow each year that can pay for future projects. Passengers also pay a facility use charge that helps to fund a portion of development costs.

"I see the port replacing the losses we had from the [end of] the shuttle program," said Rob Varley, executive director of the Space Coast Office of Tourism. Passengers who are visiting Brevard County for cruises sometimes return for full-fledged stays.

"They come in here and they learn about this area and they get just enough taste that it helps us draw them back for a future vacation," he said.

Trevor Hall Jr., director of land services for Colliers International in Central Florida, heard about the port's plans during an Urban Land Institute event last month. Hall, who is marketing a large parcel of land in Cocoa, was impressed with the long-term vision of the plan and its potential to help an area that has struggled recently.

"I think it will definitely have a positive impact, radiating out from there," he said. "Activity begets more activity."